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This morning we are seeing mixed markets around the world as all are waiting for the US Fed to release the minutes of the meeting concluding today. The “taper” word will be the key and of course any dates for the action, which I doubt we will get, will set the tone for the markets direction.

Asia and Europe are both quite mixed today also awaiting the Fed decision. Asia was off about 1.5% overnight. Europe was mixed with the UK higher and France and Germany lower.

Euro region unemployment dropped for the first time in 2 years however the rate is still at a record 12.1%.

North America is flat going into the Fed meeting, however there is additional economic news this morning. US GDP for Q2 was released and came in well above estimates at 1.7% vs. 1.0% and just behind Q1 at 1.8%. Q1 was revised down however to 1.1%. Bottom line, this is a good number but far off the level the Fed is looking at for real growth in the economy. We also had Canadian GDP which came in month over month at 0.2% vs. 0.3% and annualized (May) at 1.6% which matches estimates. The ADP Private Payrolls was also released and beat estimates by 20000 coming in at 200000 vs. 180000.

Markets are slightly lower but seemingly directionless.

The key will be Friday’s Non-Farm Payrolls that will set the tone for the Fed to move.

The problem that we have currently is good news or bad news, the markets are interpreting it as one thing – extreme volatility. We continue to try and mitigate that volatility as much as possible.

Gold is off 3.00 to 1320, oil is up 50 cents to 103.55, the loonie is down 0.09 to 96.94. The US 30 year Treasury is off a point, on the positive economic news with the yield moving higher to 3.72%

In earnings news, which I might add has generally been good, but virtually ignored, mandate company Comcast beat on both the top and bottom lines. Rio Can and First Capital Realty both beat FFO estimates and saw good revenue and cash flow growth in the first half of the year.

Today, we are seeing more upside in the Japanese markets as the asset buying program began in earnest. The Nikkei Index rose another 2.8% overnight, bringing the upside move over the past 10 days to about 10%. Of course the corresponding downside in the Yen at around 6% would suggest the race to the bottom (currency wise) is on.

Europe is trending higher on some positive German Industrial Output numbers for February and markets there are up about half a point at midday.

On a sad note, former British Prime Minister Margaret Thatcher has passed away at age 87 from a stroke. The Russians dubbed her the Iron Lady because of her strong personality and relentless negotiating abilities. She took the UK economy in the late 70’s which was on the verge of collapse and not only turned it around but changed in many ways how the country has been governed to date. Her relationship with the US and the rest of Europe was strong and she will be remembered as one of the strongest PM’s in UK history. RIP.

Moving to the North America, futures are higher by about a quarter point on the Asian and Euro news and the start of earnings season today. Forecasts are for more surprises to the upside than down and for the top line to continue its decline. If we do get some upside surprises to the top line we very could see the market continue to rally higher against the weaker economic number that were released last week. Looking at the Employment numbers from Friday, there were a few things that stood out:

· The underemployment rate fell from 14.3% to 13.8%. People are in jobs they want to be in.

· Self-Employed and small business saw increases which, in my view is very positive.

· The workforce continues to shrink and rightly so as the boomer demographic is retiring thus skewing the unemployment numbers.

· Last month was revised higher causing the raw number to be much better than announced.

In Canada the numbers were terrible vs. the estimates in raw form, but again the self-employed (small business) saw an increase in the month by 39000.

At the end of the day it is one month, and we shall see if the trend continues but for now we shall stay the course.

Gold is down a couple of bucks trading at 1573, oil is up more than half a point to 93.30 and the Loonie is flat at 98.25.